M/S Norseman Oilfield Technologies Fz-Llc And Anr vs. M/S Oil INDIA Limited And 5 Ors.

Facts

M/s Norseman Oilfield Technologies FZ-LLC (petitioner no. 1) and its subsidiary M/s Norseman Oilfield Technologies (Assam) Pvt Ltd (petitioner no. 2) participated in a tender floated by Oil India Limited (OIL) for charter hire of a hydraulic workover unit. Petitioner no. 2 qualified based on petitioner no. 1's experience. OIL issued a Letter of Award (LoA) on 04.09.2024 for an estimated contract cost of INR 302,27,99,540.88, inclusive of GST. The LoA required performance security of INR 9.00 crores and an additional performance security of INR 4.50 crores. Petitioners furnished the additional security but faced difficulties in depositing the INR 9.00 crores due to foreign exchange restrictions imposed by the Reserve Bank of India. OIL terminated the contract on 07.05.2025. Subsequently, an order dated 08.11.2025 placed petitioner no. 2 and its allied firms on a one-year holiday listing from 10.07.2025. Petitioners appealed this order on 03.12.2025 and also requested the refund of the INR 4.50 crores additional performance security on 23.01.2025, but no formal decision was communicated.

Held

The Court held that the writ petition was not to be adjudicated at this stage because the appeal filed by the petitioners against the holiday listing order dated 08.11.2025 was still pending before the appellate authority. The Court noted that no final decision had been passed or communicated to the petitioners regarding the refund or otherwise of the additional performance security amount of INR 4.50 crores. Therefore, the Court directed the appellate authority to take the appeal on board and dispose of it on its merits on or before 30.04.2026, considering the petitioners' highlighted reasons. The competent authority in OIL was also directed to take a decision on the aspect of refund or otherwise of the additional performance security amount of INR 4.50 crores on or before 30.04.2026. The Court clarified that its order did not preclude the petitioners from seeking appropriate remedies on all three aspects (termination order, refund of security, and holiday listing) if aggrieved by future decisions. The ratio decidendi is that when an appeal is pending and a related financial matter is undecided, the High Court may direct the appellate authority to expedite the appeal and the relevant authority to decide the financial matter within a stipulated timeframe, rather than adjudicating the writ petition prematurely.

Key Issues

1. Whether the writ petition is premature given that an appeal filed by the petitioners against the holiday listing order is pending before the appellate authority? (Mixed question of law and fact, turning on the principle of exhaustion of alternative remedies). 2. Whether a formal decision has been taken and communicated regarding the refund of the additional performance security amount of INR 4.50 crores? Petitioner's arguments: The petitioners argued that the order dated 08.11.2025 only pertained to holiday listing and was silent on the release of the INR 4.50 crores additional performance security, for which a refund was requested on 23.01.2025. They contended that despite indications of action regarding this amount, no formal order had been communicated. Revenue's (OIL) arguments: The learned Standing Counsel for OIL submitted that the writ petition was premature as the appeal preferred by the petitioners before the appellate authority was yet to be disposed of. He further stated that if no formal decision had been taken on the refund of the additional performance security, OIL authorities would take a formal decision.